Virtual Assistant Versus Full-Time Employee Cost Comparison
When companies consider outsourcing processes or tasks to a virtual assistant or consultant, one of the first things they discover is the significant cost savings virtual assistants offer over traditional employees. As all employers with payrolls are painfully aware of, the base wage they pay their employees is only a portion of their actual cost. When you include federal and state payroll taxes, FICA, insurance benefits, vacation pay, equipment, office space and training, the “real” cost of an employee can be over twice their “base” pay. Aside from payroll itself, employee benefits are one of the biggest cash drains on businesses both small and large.
By using the services of a virtual assistant from Virtual Assistant, Inc., all you pay is a set monthly fee. Since our VA’s are our employees, we pay for all of the costs associated with their employment. Our virtual assistants work full-time for you, 40 hours a week. Getting a full-time virtual assistant means no more employee turnover, no lost productivity and no training costs.
Some virtual assistant websites use fantastic calculations for cost comparisons that turn a $15 an hour job into a $65,000 annual salary. At Virtual Assistant.Org, we don’t need to stretch the truth when the truth is so obvious. The savings are startling. Do the math.
| Compare Costs: | Pay Rate | Yearly Pay | Overhead Cost | "Actual" Annual Wage |
| Full Time Employee |
$12 / hour employee @ 40 hours / week = $480 per week |
x 52 weeks |
+ 30% overhead of $7,488 |
$32,448 |
| Employee on Salary |
$30,000 per year salaried employee |
x 1 year |
+ 30% overhead of $9,000 |
$39,000 |
| Full Time Virtual Assistant |
VA.Org Basic Plan @ $1,195 per month for 160 hours |
x 12 months |
ZERO |
$14,340 |
|
VA.org Annual cost savings vs $12 per hour employee $18,108 |
VA.org Annual cost savings vs $30k salaried employee $24,660 |
It doesn’t take long to see how dramatic the savings are. We used the relatively conservative figure of 30% overhead costs; the U.S. Chamber of Commerce places the cost at nearly 40%. Depending on the type of health care benefits you provide and if you’re bound to a contract agreement, the additional employee costs can be staggering. The U.S. Department of Labor reports than more than 44% of company payrolls in 2005 consisted of employee benefits!
Additional Costs of In-house Employees
These cost savings only deal with wages. What about all the other costs associated with hiring full-time employees? When employees are “on the clock” what are you really paying for? How many of these unproductive and costly habits do your employees practice?
- Frequent socializing
- Running personal errands on company time
- Prolonged Internet surfing
- Late to arrive/early to leave
- Personal phone calls and emails
When you compare the cost of a full-time employee to a full-time virtual assistant using our Basic Plan, the benefits are obvious. You get a full-time skilled worker for less than $15,000 a year! That’s quite a bargain in these tough economic times. When you outsource to a virtual assistant, your business can improve efficiency, productivity and cost-effectiveness that will undoubtedly increase your bottom line. See how VirtualAssistant.Org can provide reliable, professional help so you can focus on the core aspects of your business.
Considering Other Employment Options
As another option you may consider going to a temporary placement agency and hiring a temporary employee. Either a temp or a VA can work on a short term job. They are both flexible in that the service may end when the project is finished, or you may choose to hire the temp worker full time (which brings us back to full time verses VA). When considering a temp verses VA, read this article on comparing a temporary employee to a virtual assistant.
May 20th, 2008
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